State-run Taiwan Power Co (Taipower, 台電) yesterday saw its ratings outlook changed to "negative" from "stable" by Moody's Investors Service following a government decision to freeze electricity rates amid high fuel prices.
Moody's gave Taipower an "A1" issuer rating and an "Aaa.tw" national scale rating, while affirming the company's TW-1 short-term national scale rating, the ratings agency said in a statement.
The change reflected the ratings agency's concern over Taipower's "financial profile and cash flow generating capability" in the near term, Moody's said, adding that the action would affect up to NT$235 billion (US$7.3 billion) in debt securities issued by the power company.
"Without a tariff increase to compensate for the hike in fuel costs, the company's liquidity profile will be weakened further," Ken Chan (
Taipower's financial profile has been affected by the government's plan late last year to freeze tariffs on water, electricity, liquified petroleum gas, gasoline and natural gas to ease inflationary pressures amid surging oil prices.
The company estimated at the time that it would suffer a loss of NT$25 billion (US$769.7 million) last year if electricity rates were not raised to reflect rising fuel costs.
Chan said Taipower was at risk of a further ratings downgrade "if its operating performance weakens further, due to lower electricity demand or higher fuel costs, but without a near-term tariff increase."
Three experts in the high technology industry have said that US President Donald Trump’s pledge to impose higher tariffs on Taiwanese semiconductors is part of an effort to force Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) to the negotiating table. In a speech to Republicans on Jan. 27, Trump said he intends to impose tariffs on Taiwan to bring chip production to the US. “The incentive is going to be they’re not going to want to pay a 25, 50 or even a 100 percent tax,” he said. Darson Chiu (邱達生), an economics professor at Taichung-based Tunghai University and director-general of
‘LEGACY CHIPS’: Chinese companies have dramatically increased mature chip production capacity, but the West’s drive for secure supply chains offers a lifeline for Taiwan When Powerchip Technology Corp (力晶科技) entered a deal with the eastern Chinese city of Hefei in 2015 to set up a new chip foundry, it hoped the move would help provide better access to the promising Chinese market. However, nine years later, that Chinese foundry, Nexchip Semiconductor Corp (合晶集成), has become one of its biggest rivals in the legacy chip space, leveraging steep discounts after Beijing’s localization call forced Powerchip to give up the once-lucrative business making integrated circuits for Chinese flat panels. Nexchip is among Chinese foundries quickly winning market share in the crucial US$56.3 billion industry of so-called legacy
Zhang Yazhou was sitting in the passenger seat of her Tesla Model 3 when she said she heard her father’s panicked voice: The brakes do not work. Approaching a red light, her father swerved around two cars before plowing into a sport utility vehicle and a sedan, and crashing into a large concrete barrier. Stunned, Zhang gazed at the deflating airbag in front of her. She could never have imagined what was to come: Tesla Inc sued her for defamation for complaining publicly about the vehicles brakes — and won. A Chinese court ordered Zhang to pay more than US$23,000 in
Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) yesterday held its first board of directors meeting in the US, at which it did not unveil any new US investments despite mounting tariff threats from US President Donald Trump. Trump has threatened to impose 100 percent tariffs on Taiwan-made chips, prompting market speculation that TSMC might consider boosting its chip capacity in the US or ramping up production of advanced chips such as those using a 2-nanometer technology process at its Arizona fabs ahead of schedule. Speculation also swirled that the chipmaker might consider building its own advanced packaging capacity in the US as part
RSS